Global drivers

To predict and shape the future

In 2012, the Volvo Group celebrates 85 years. In 1927, the first series-produced Volvo car rolled off the production line at the Gothenburg plant and in 1928 the first truck was produced. For 85 years, Volvo has developed pioneering products and services, and been a driving force for socio-economic development.

Much has happened since 1927. The Volvo Group has evolved from a small local industry to one of the world’s largest manufacturers of trucks, buses and construction equipment with approximately 100,000 employees, production facilities in 20 countries and sales in more than 190 countries.

It is crucial to keep pace in a rapidly changing world. Today, it is more important than ever to understand our operating environment, how it impacts the Volvo Group and, above all, to act on these changes to meet future transport needs. In this section, we will define some of the more significant challenges and the actions being undertaken by the Volvo Group to meet these challenges.

It is crucial to keep pace in a rapidly changing world.

Challenges

Population growth, urbanization and megacities

Climate change, oil resources and alternative fuels

Shortage of natural resources and raw material

Safety and security

Skilled employees

1. Population growth, urbanization and megacities

The world's population is constantly increasing. By 2050, it is expected to exceed nine billion. Since 2008, more than half the world’s population live in cities and in fifty years, that figure is expected to be two-thirds. The most intensive pace of urbanization is taking place in Africa and Asia. In addition, the number of megacities and megaregions with populations exceeding ten million is growing rapidly. Approximately 20% of the world’s population is expected to live in cities with populations in excess of two million inhabitants by 2015.

This trend is leading to an increased need for transportation. People, as well as large quantities of goods, are transported daily within as well as to and from cities. Cities, particularly major cities, have specific requirements for town and traffic planning. Furthermore, congestion and noise pollution need to be addressed through vehicles specially adapted for urban environments.

The Volvo Group's approach

We are working on parallel approaches to improve transport solutions for the world's cities to enable more goods and people to be transported without increasing congestion and emissions.

Transport systems such as Bus Rapid Transit (BRT) need to be further developed to reduce congestion.

The Volvo Group is involved in telematic solutions for more flexible public transports and efficient goods distribution, which will lead to more efficent planning of transport routes, greater traffic security and better planning of maintenance work.

2. Climate change, oil resources and alternative fuels

Climate change is one of the most complex and difficult questions of our time. Fossil fuel is the single largest source of greenhouse-gas emissions, which are considered responsible for climate change. Oil has long been considered a reliable source of energy, but today, oil use is a highly contested issue. This is primarily attributable to the environmental problems associated with oil, but also because future access to oil is uncertain due to dwindling oil reserves and instability in oil-producing regions.

It is no longer a question of whether we have to convert to a fossil-free society; it is now a question of how this will be achieved and at what pace it will be performed. Major efforts have been made to develop the use of renewable-energy sources. However, the development of renewable fuels differs widely in different regions depending on the natural resources available, which, in turn, entails a challenge in the form of developing vehicles adapted for various types of fuel. The move towards the large-scale use of renewable fuel is also dependent on political decisions to create the necessary infrastructure.

The Volvo Group's approach:

We strive to meet these challenges by improving the energy efficiency, improving logistic systems and carbon dioxide neutrality. Electromobility is one solution to decrease carbon dioxide emission and increase energy efficiency. The shift towards well-to-wheel efficient renewable fuels will also decrease the carbon dioxide emissions, but the shift towards large-scale use of renewable fuels depends on policy decisions by governments to establish the infrastructure required.

We participate in different collaborations to develop more efficient transport systems.

It is no longer a question of whether we have to convert to a fossil-free society; it is now a question of how this will be achieved and at what pace it will be performed.

3. Shortage of natural resources and raw material

Population growth, a rapidly growing middle class and greater purchasing power leads to increasing numbers of people consuming in line with western consumption patterns. Mankind is utilizing an increasing amount of land and resources. More efficient use of resources is required and the recovery of a greater proportion of material is becoming increasingly important to secure access to materials.

The Volvo Group's approach:

We strive to decrease the use of material and other resources in our products and therefore we take the life-cycle perspective into account in product development. Today approximatly 30% of a truck is produced from recycled material.

New materials based on nanostructured compounds or alloys could create light-weight materials without losing the mechanical strength and thus create opportunies to reduce the weight of vehicles.

4. Safety and security

Traffic safety is becoming even more important as transportation increases. There has also been an increase in awareness and the demand for safe products and safety guidelines at construction and operation sites. The subject is a high priority for governments and institutions worldwide.

In the future, focus on security is also likely to continue to increase because of military conflicts, crime, terrorism and natural disasters, which will impact the safety of drivers, vehicles and goods.

The Volvo Group's approach:

We are working together with authorities and academia to find new safety features and raise awerness of safety issues both on a local and global level.

The need for competent employees with specialist skills will increase as products and services become increasingly sophisticated.

5. Skilled employees

For many years, interest has waned for education and careers in the fields of mathematics, natural sciences and engineering in industrialized countries. However, the need for competent employees with these types of specialist skills will increase as products and services become increasingly sophisticated.

The Volvo Group's approach:

We work to promote and stimulate the interest in science and technology by reaching out to young people and supporting educations in the mathematics, natural sciences and engineering field.

Did you know?

Approximately 20% of the world’s population is expected to live in cities with populations in excess of two million inhabitants by 2015.